Exhibit 1.1
Execution Copy
COMMERCIAL METALS COMPANY
$400,000,000
6.50% Notes due July 15, 2017
UNDERWRITING AGREEMENT
July 12, 2007
Banc of America Securities LLC
ABN AMRO Incorporated
UNDERWRITING AGREEMENT
July 12, 2007
BANC OF
AMERICA SECURITIES LLC
ABN AMRO INCORPORATED
As Representatives of the several Underwriters
c/o BANC OF AMERICA SECURITIES LLC
9 West 57 th Street
New York, NY 10019
Ladies
and Gentlemen:
Introductory . Commercial
Metals Company, a Delaware corporation (the “Company”),
proposes to issue and sell to the several underwriters named in
Schedule A (the “Underwriters”), acting severally
and not jointly, the respective amounts set forth in such
Schedule A of $400,000,000 aggregate principal amount of the
Company’s 6.50% Notes due July 15, 2017 (the
“Notes”). Banc of America Securities LLC
(“BAS”) and ABN AMRO Incorporated have agreed to act as
representatives of the several Underwriters (in such capacity, the
“Representatives”) in connection with the offering and
sale of the Notes.
The Notes will be issued pursuant to
an indenture, dated as of July 31, 1995 (the “Base
Indenture”), between the Company and The Bank of New York
Trust Company, N.A. (successor to JPMorgan Chase Bank), as trustee
(the “Trustee”). Certain terms of the Notes will be
established pursuant to a supplemental indenture to the Base
Indenture (the “Supplemental Indenture,” together with
the Base Indenture, the “Indenture”). The Notes will be
issued in book-entry form in the name of Cede & Co., as nominee
of The Depository Trust Company (the “Depositary”),
pursuant to a Letter of Representations, to be dated on or before
the Closing Date (as defined in Section 2 below) (the
“DTC Agreement”), among the Company, the Trustee and
the Depositary.
The Company has prepared and filed
with the Securities and Exchange Commission (the
“Commission”) a registration statement on Form S-3
(File No. 333-144500), which contains a base prospectus (the
“Base Prospectus”), to be used in connection with the
public offering and sale of debt securities, including the Notes,
of the Company under the Securities Act of 1933, as amended, and
the rules and regulations promulgated thereunder (collectively, the
“Securities Act”), and the offering thereof from time
to time in accordance with Rule 415 under the Securities Act.
Such registration statement, including the financial statements,
exhibits and schedules thereto, in the form in which it became
effective under the Securities Act, including any required
information deemed to be a part thereof at the time of
effectiveness pursuant to Rule 430B under the Securities Act,
is called the “Registration Statement.” The term
“Prospectus” shall mean the final prospectus supplement
relating to the Notes, together with the Base Prospectus, that is
first filed pursuant to Rule 424(b) after the date and time that
this
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Agreement is executed (the “Execution Time”) by the
parties hereto. The term “Preliminary Prospectus” shall
mean any preliminary prospectus supplement relating to the Notes,
together with the Base Prospectus, that is first filed with the
Commission pursuant to Rule 424(b). Any reference herein to
the Registration Statement, the Preliminary Prospectus or the
Prospectus shall be deemed to refer to and include the documents
that are or are deemed to be incorporated by reference therein
pursuant to Item 12 of Form S-3 under the Securities Act prior
to 2:45 p.m. on July 12, 2007 (the “Initial Sale
Time”). All references in this Agreement to the Registration
Statement, the Preliminary Prospectus, the Prospectus, or any
amendments or supplements to any of the foregoing, shall include
any copy thereof filed with the Commission pursuant to its
Electronic Data Gathering, Analysis and Retrieval System
(“EDGAR”).
All references in this Agreement to
financial statements and schedules and other information which is
“contained,” “included” or
“stated” (or other references of like import) in the
Registration Statement, the Prospectus or the Preliminary
Prospectus shall be deemed to mean and include all such financial
statements and schedules and other information which is or is
deemed to be incorporated by reference in the Registration
Statement, the Prospectus or the Preliminary Prospectus, as the
case may be, prior to the Initial Sale Time; and all references in
this Agreement to amendments or supplements to the Registration
Statement, the Prospectus or the Preliminary Prospectus shall be
deemed to include the filing of any document under the Securities
Exchange Act of 1934, as amended, and the rules and regulations
promulgated thereunder (collectively, the “Exchange
Act”), which is or is deemed to be incorporated by reference
in the Registration Statement, the Prospectus or the Preliminary
Prospectus, as the case may be, after the Initial Sale Time.
The
Company hereby confirms its agreements with the Underwriters as
follows:
Section 1. Representations
and Warranties of the Company
The Company hereby represents,
warrants and covenants to each Underwriter as of the date hereof,
as of the Initial Sale Time and as of the Closing Date (in each
case, a “Representation Date”), as follows:
a) Compliance with Registration
Requirements . The Company meets the requirements for use of
Form S-3 under the Securities Act. The Registration Statement has
become effective under the Securities Act and no stop order
suspending the effectiveness of the Registration Statement has been
issued under the Securities Act and no proceedings for that purpose
have been instituted or are pending or, to the knowledge of the
Company, are contemplated or threatened by the Commission, and any
request on the part of the Commission for additional information
has been complied with. In addition, the Indenture has been duly
qualified under the Trust Indenture Act of 1939, as amended, and
the rules and regulations promulgated thereunder (the “Trust
Indenture Act”).
At the respective times the
Registration Statement and any post-effective amendments thereto
became effective and at each Representation Date, the Registration
Statement and any amendments thereto (i) complied and will
comply in all material respects with the requirements of the
Securities Act and the Trust Indenture Act, and (ii) did not
and will not contain any untrue statement of a material fact or
omit to state a material fact required to be stated therein
or
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necessary to make the statements therein not misleading. At the
date of the Prospectus and at the Closing Date, neither the
Prospectus nor any amendments or supplements thereto included or
will include an untrue statement of a material fact or omitted or
will omit to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which
they were made, not misleading. Notwithstanding the foregoing, the
representations and warranties in this subsection shall not apply
to statements in or omissions from the Registration Statement or
any post-effective amendment or the Prospectus or any amendments or
supplements thereto made in reliance upon and in conformity with
information furnished to the Company in writing by any of the
Underwriters through the Representatives expressly for use therein,
it being understood and agreed that the only such information
furnished by any Underwriter through the Representatives consists
of the information described as such in Section 8
hereof.
Each Preliminary Prospectus and the
Prospectus, at the time each was filed with the SEC, complied in
all material respects with the Securities Act, and the Preliminary
Prospectus and the Prospectus delivered to the Underwriters for use
in connection with the offering of the Notes will, at the time of
such delivery, be identical to any electronically transmitted
copies thereof filed with the Commission pursuant to EDGAR, except
to the extent permitted by Regulation S-T.
b) Disclosure Package . The
term “Disclosure Package” shall mean (i) the
Preliminary Prospectus dated July 12, 2007, (ii) the
issuer free writing prospectuses as defined in Rule 433 of the
Securities Act (each, an “Issuer Free Writing
Prospectus”), if any, identified in Annex I hereto and
(iii) any other free writing prospectuses that the parties
hereto shall hereafter expressly agree in writing to treat as part
of the Disclosure Package. As of the Initial Sale Time, the
Disclosure Package did not contain any untrue statement of a
material fact or omit to state any material fact necessary in order
to make the statements therein, in the light of the circumstances
under which they were made, not misleading. The preceding sentence
does not apply to statements in or omissions from the Disclosure
Package based upon and in conformity with written information
furnished to the Company by any Underwriter through the
Representatives specifically for use therein, it being understood
and agreed that the only such information furnished by any
Underwriter through the Representatives consists of the information
described as such in Section 8 hereof.
c) Incorporated Documents .
The documents incorporated or deemed to be incorporated by
reference in the Registration Statement, the Preliminary Prospectus
and the Prospectus (i) at the time they were or hereafter are
filed with the Commission, complied or will comply in all material
respects with the requirements of the Exchange Act and
(ii) when read together with the other information in the
Disclosure Package, at the Initial Sale Time, and when read
together with the other information in the Prospectus, at the date
of the Prospectus and at the Closing Date, did not or will not
include an untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not
misleading.
d) Company is a Well-Known
Seasoned Issuer . (i) At the time of the filing the
Registration Statement, (ii) at the time of the most recent
amendment thereto for the purposes of complying with
Section 10(a)(3) of the Securities Act (whether such amendment
was by post-effective amendment, incorporated report filed pursuant
to Section 13 or 15(d) of the
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Exchange
Act or form of prospectus), (iii) at the time the Company or
any person acting on its behalf (within the meaning, for this
clause (iii) only, of Rule 163(c) of the Securities Act) made
any offer relating to the Notes in reliance on the exemption of
Rule 163 of the Securities Act, and (iv) as of the
Execution Time, the Company was and is a “well-known seasoned
issuer” as defined in Rule 405 of the Securities Act.
The Registration Statement is an “automatic shelf
registration statement,” as defined in Rule 405 of the
Securities Act, that automatically became effective not more than
three years prior to the Execution Time; the Company has not
received from the Commission any notice pursuant to
Rule 401(g)(2) of the Securities Act objecting to use of the
automatic shelf registration statement form; and the Company has
not otherwise ceased to be eligible to use the automatic shelf
registration form.
e) Company is not an Ineligible
Issuer . (i) At the time of filing the Registration
Statement and (ii) as of the Execution Time (with such date
being used as the determination date for purposes of this clause
(ii)), the Company was not and is not an Ineligible Issuer (as
defined in Rule 405 of the Securities Act), without taking
account of any determination by the Commission pursuant to
Rule 405 of the Securities Act that it is not necessary that
the Company be considered an Ineligible Issuer.
f) Issuer Free Writing
Prospectuses . Each Issuer Free Writing Prospectus, as of its
issue date and at all subsequent times through the completion of
the offering of Notes under this Agreement or until any earlier
date that the Company notified or notifies the Representatives as
described in the next sentence, did not, does not and will not
include any information that conflicted, conflicts or will conflict
with the information contained or incorporated by reference in the
Registration Statement, the Preliminary Prospectus or the
Prospectus. If at any time following issuance of an Issuer Free
Writing Prospectus there occurred or occurs an event or development
as a result of which such Issuer Free Writing Prospectus conflicted
or would conflict with the information contained or incorporated by
reference in the Registration Statement, the Preliminary Prospectus
or the Prospectus, the Company has promptly notified or will
promptly notify the Representatives and has promptly amended or
supplemented or will promptly amend or supplement, at its own
expense, such Issuer Free Writing Prospectus to eliminate or
correct such conflict. The foregoing two sentences do not apply to
statements in or omissions from any Issuer Free Writing Prospectus
based upon and in conformity with written information furnished to
the Company by any Underwriter through the Representatives
specifically for use therein, it being understood and agreed that
the only such information furnished by any Underwriter through the
Representatives consists of the information described as such in
Section 8 hereof.
g) Distribution of Offering
Material By the Company . The Company has not distributed and
will not distribute, prior to the later of the Closing Date and the
completion of the Underwriters’ distribution of the Notes,
any offering material in connection with the offering and sale of
the Notes other than the Preliminary Prospectus, the Prospectus,
any Issuer Free Writing Prospectus reviewed and consented to by the
Representatives and included in Annex I hereto or the Registration
Statement.
h) No Applicable Registration or
Other Similar Rights . There are no persons with registration
or other similar rights to have any equity or debt securities
registered for sale under
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the
Registration Statement or included in the offering contemplated by
this Agreement, except for such rights as have been duly
waived.
i) The Underwriting Agreement
. This Agreement has been duly authorized, executed and delivered
by the Company.
j) Authorization of the
Indenture . The Indenture has been duly qualified under the
Trust Indenture Act and has been duly authorized, executed and
delivered by the Company and constitutes a valid and binding
agreement of the Company, enforceable against the Company in
accordance with its terms, except as the enforcement thereof may be
limited by bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium or other similar laws relating to or
affecting the rights and remedies of creditors or by general
equitable principles.
k) Authorization of the Notes
. The Notes to be purchased by the Underwriters from the Company
are in the form contemplated by the Indenture, have been duly
authorized for issuance and sale pursuant to this Agreement and the
Indenture and, at the Closing Date, will have been duly executed by
the Company and, when authenticated in the manner provided for in
the Indenture and delivered against payment of the purchase price
therefor, will constitute valid and binding obligations of the
Company, enforceable in accordance with their terms, except as the
enforcement thereof may be limited by bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium or other similar
laws relating to or affecting the rights and remedies of creditors
or by general equitable principles, and will be entitled to the
benefits of the Indenture.
l) Description of the Notes and
the Indenture . The Notes and the Indenture conform in all
material respects to the descriptions thereof contained in the
Disclosure Package and the Prospectus.
m) Accuracy of Statements in
Prospectus . The statements in each of the Preliminary
Prospectus and the Prospectus under the captions “Description
of Notes,” “Description of Debt Securities” and
“United States Taxation,” in each case insofar as such
statements constitute a summary of the legal matters, documents or
proceedings referred to therein, fairly present and summarize, in
all material respects, the matters referred to therein.
n) No Material Adverse Change
. Except as otherwise disclosed in the Disclosure Package,
subsequent to the respective dates as of which information is given
in the Disclosure Package, (i) there has been no material adverse
change, or any development that would reasonably be expected to
result in a material adverse change, in the condition, financial or
otherwise, or in the earnings, management, business, properties,
results of operations, whether or not arising from transactions in
the ordinary course of business, of the Company and its
subsidiaries, considered as one entity (any such change is called a
“Material Adverse Change”), and (ii) neither the
Company nor any of its subsidiaries has sustained any loss or
interference with its business from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or decree that,
individually or in the aggregate, would reasonably be expected to
result in a Material Adverse Change.
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o) Independent Accountants .
Deloitte & Touche LLP, who have expressed their opinion with
respect to the Company’s audited financial statements for the
fiscal years ended August 31, 2004, 2005 and 2006 incorporated
by reference in the Registration Statement, the Preliminary
Prospectus and the Prospectus, are independent public accountants
with respect to the Company as required by the Securities Act and
the Exchange Act and are an independent registered public
accounting firm with the Public Company Accounting Oversight
Board.
p) Preparation of the Financial
Statements . The financial statements together with the related
notes thereto incorporated by reference in the Registration
Statement, the Preliminary Prospectus and the Prospectus present
fairly the consolidated financial position of the Company and its
subsidiaries as of and at the dates indicated and the results of
their operations and cash flows for the periods specified. Such
financial statements comply as to form with the accounting
requirements of the Securities Act and have been prepared in
conformity with generally accepted accounting principles in the
United States applied on a consistent basis throughout the periods
involved, except as may be expressly stated in the related notes
thereto. No other financial statements are required to be included
in the Registration Statement. The selected financial data and the
summary financial information included in the Preliminary
Prospectus and the Prospectus present fairly the information shown
therein and have been compiled on a basis consistent with that of
the audited financial statements included in the Registration
Statement, the Preliminary Prospectus and the Prospectus. In
addition, if any pro forma financial statements of the Company and
its subsidiaries and the related notes thereto are included in the
Registration Statement, the Preliminary Prospectus and the
Prospectus, such pro forma financial statements and related notes
present fairly the information shown therein, have been prepared in
accordance with the Commission’s rules and guidelines with
respect to pro forma financial statements and have been properly
compiled on the bases described therein, and the assumptions used
in the preparation thereof are reasonable and the adjustments used
therein are appropriate to give effect to the transactions and
circumstances referred to therein.
q) Incorporation and Good Standing
of the Company and its Subsidiaries . Each of the
Company’s Significant Subsidiaries and its jurisdiction of
formation is set forth on Schedule B attached hereto. Each of
the Company and its Significant Subsidiaries has been duly
incorporated and is validly existing as a corporation in good
standing under the laws of the jurisdiction of its incorporation
and has corporate power and authority to own or lease, as the case
may be, and operate its properties and to conduct its business as
described in the Disclosure Package and the Prospectus and, in the
case of the Company, to enter into and perform its obligations
under this Agreement. Each of the Company and each subsidiary is
duly qualified as a foreign corporation to transact business and is
in good standing in each jurisdiction in which such qualification
is required, whether by reason of the ownership or leasing of
property or the conduct of business, except for such jurisdictions
where the failure to so qualify or to be in good standing would,
individually or in the aggregate, result in a Material Adverse
Change. All of the issued and outstanding shares of capital stock
of each subsidiary have been duly authorized and validly issued,
are fully paid and nonassessable and are owned by the Company,
directly or through subsidiaries, free and clear of any security
interest, mortgage, pledge, lien, encumbrance or claim. The Company
does not have any subsidiary not listed on Exhibit 21 to the
Annual Report on Form 10-K which is required to be so listed. For
purposes of this Agreement, “Significant Subsidiary”
means any subsidiary of the Company that owns or leases a Material
Property or owns or controls capital stock which under ordinary
circumstances has the voting
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power to
elect a majority of the board of directors (or similar governing
body) of a subsidiary that owns Material Property. For purposes of
this Agreement, “Material Property” means any facility
(together with the land on which it is erected and fixtures
comprising a part thereof) used primarily for manufacturing,
processing, research, warehousing or distribution, owned or leased
by the Company or one of its subsidiaries and (i) having a net
book value in excess of 3% of the Company’s consolidated net
tangible assets, other than any such facility or portion thereof
which is a pollution control facility financed by the state or
local government obligations or is not of material importance to
the total business conducted or assets owned by the Company and its
subsidiaries taken as a whole or (ii) acquired with net
proceeds from a sale or leaseback transaction and which is
irrevocably designated in writing by the Company as a Material
Property.
r) Capitalization and Other
Capital Stock Matters . The authorized, issued and outstanding
capital stock of the Company is as set forth in the Disclosure
Package and the Prospectus under the caption
“Capitalization” (other than for subsequent issuances,
if any, pursuant to employee benefit plans described in the
Disclosure Package and the Prospectus or upon exercise of
outstanding options described in the Disclosure Package and the
Prospectus, as the case may be).
s) Non-Contravention of Existing
Instruments; No Further Authorizations or Approvals Required .
Neither the Company nor any of its Significant Subsidiaries is
(i) in violation or in default (or, with the giving of notice
or lapse of time or both, would be in default)
(“Default”) under its charter or by-laws, (ii) in
Default under any indenture, mortgage, loan or credit agreement,
deed of trust, note, contract, franchise, lease or other agreement,
obligation, condition, covenant or instrument to which the Company
or any of its subsidiaries is a party or by which it or any of them
may be bound or to which any of the property or assets of the
Company or any of its subsidiaries is subject (each, an
“Existing Instrument”) or (iii) in violation of
any statute, law, rule, regulation, judgment, order or decree of
any court, regulatory body, administrative agency, governmental
body, arbitrator or other authority having jurisdiction over the
Company or any of its subsidiaries or any of its or their
properties, as applicable, except, with respect to clauses (ii) and
(iii) only, for such Defaults or violations as would not,
individually or in the aggregate result in a Material Adverse
Change. The Company’s execution, delivery and performance of
this Agreement and consummation of the transactions contemplated
hereby, by the Disclosure Package and by the Prospectus
(i) have been duly authorized by all necessary corporate
action and will not result in any Default under the charter or
by-laws of the Company or any Significant Subsidiary,
(ii) will not conflict with or constitute a breach of, or
Default or a Debt Repayment Triggering Event (as defined below)
under, or result in the creation or imposition of any lien, charge
or encumbrance upon any property or assets of the Company or any of
its Significant Subsidiaries pursuant to, or require the consent of
any other party to, any Existing Instrument, and (iii) will
not result in any violation of any statute, law, rule, regulation,
judgment, order or decree applicable to the Company or any of its
Significant Subsidiaries of any court, regulatory body,
administrative agency, governmental body, arbitrator or other
authority having jurisdiction over the Company or any of its
Significant Subsidiaries or any of its or their properties. No
consent, approval, authorization or other order of, or registration
or filing with, any court or other governmental or regulatory
authority or agency is required for the Company’s execution,
delivery and performance of this Agreement or consummation of the
transactions contemplated hereby, by the Disclosure Package or by
the Prospectus, except such as have been
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obtained
or made by the Company and are in full force and effect under the
Securities Act, applicable state securities or blue sky laws and
from the NASD, Inc. (the “NASD”). As used herein, a
“Debt Repayment Triggering Event” means any event or
condition which gives, or with the giving of notice or lapse of
time or both would give, the holder of any note, debenture or other
evidence of indebtedness (or any person acting on such
holder’s behalf) issued by the Company, the right to require
the repurchase, redemption or repayment of all or a portion of such
indebtedness by the Company or any of its Significant
Subsidiaries.
t) No Material Actions or
Proceedings . Except as disclosed in the Prospectus and the
Disclosure Package, there are no legal or governmental actions,
suits or proceedings pending or, to the best of the Company’s
knowledge, threatened (i) against or affecting the Company or
any of its subsidiaries, (ii) which has as the subject thereof
any officer or director of, or property owned or leased by, the
Company or any of its subsidiaries or (iii) relating to
environmental or discrimination matters related to the Company or
its subsidiaries, where any such action, suit or proceeding, if
determined adversely, would, individually or in the aggregate,
reasonably be expected to result in a Material Adverse Change or
adversely affect the consummation of the transactions contemplated
by this Agreement.
u) Labor Matters . No dispute
with the employees of the Company or any of its subsidiaries
exists, and the Company, to its knowledge, is not aware of any
existing or imminent labor disturbance by the employees of any of
its or its subsidiaries’ principal suppliers, contractors or
customers, that would, individually or in the aggregate, reasonably
be expected to result in a Material Adverse Change.
v) Intellectual Property
Rights . Except as set forth in the Disclosure Package and the
Prospectus, the Company or its subsidiaries own or possess a valid
right to use all patents, trademarks, service marks, trade names,
copyrights, patentable inventions, trade secret, know-how and other
intellectual property (collectively, the “Intellectual
Property”) used by the Company or its subsidiaries in, the
conduct of the Company’s or its subsidiaries’ business
as now conducted or as proposed in the Disclosure Package and the
Prospectus to be conducted. Except as set forth in the Disclosure
Package and the Prospectus, there is no material infringement by
third parties of any of the Company’s Intellectual Property
and there are no legal or governmental actions, suits, proceedings
or claims pending or, to the Company’s knowledge, threatened,
against the Company (i) challenging the Company’s rights in
or to any Intellectual Property, (ii) challenging the validity
or scope of any Intellectual Property owned by the Company, or
(iii) alleging that the operation of the Company’s
business as now conducted infringes or otherwise violates any
patent, trademark, copyright, trade secret or other proprietary
rights of a third party, and the Company is unaware of any facts
which would form a reasonable basis for any such claim, where any
such action, suit, proceeding or claim, if determined adversely,
would, individually or in the aggregate, reasonably be expected to
result in a Material Adverse Change or adversely affect the
consummation of the transactions contemplated by this
Agreement.
w) All Necessary Permits, etc
. The Company and each Significant Subsidiary possess such valid
and current certificates, authorizations, permits, licenses,
approvals, consents and other authorizations issued by the
appropriate state, federal or foreign regulatory agencies or bodies
necessary to conduct their respective businesses, and neither the
Company nor any
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Significant Subsidiary has received any written notice of
proceedings relating to the revocation or modification of, or
non-compliance with, any such certificate, authorization, permit,
license, approval, consent or other authorization which, singly or
in the aggregate, if the subject of an unfavorable decision, ruling
or finding, would reasonably be expected to result in a Material
Adverse Change.
x) Title to Properties .
Except as otherwise disclosed in the Disclosure Package and the
Prospectus, the Company and each of its subsidiaries has good and
marketable title to all the properties and assets reflected as
owned in the financial statements referred to in Section 1(p) above
(or elsewhere in the Disclosure Package and the Prospectus), in
each case free and clear of any security interests, mortgages,
liens, encumbrances, equities, claims and other defects, except
such as would not result in a Material Adverse Change. The real
property, improvements, equipment and personal property held under
lease by the Company or any subsidiary are held under valid and
enforceable leases, with such exceptions as would not result in a
Material Adverse Change.
y) Tax Law Compliance . The
Company and its subsidiaries have filed all necessary federal,
state, local and foreign income and franchise tax returns in a
timely manner and have paid all taxes required to be paid by any of
them and, if due and payable, any related or similar assessment,
fine or penalty levied against any of them, except (i) for any
taxes, assessments, fines or penalties as may be being contested in
good faith and by appropriate proceedings, or (ii) where a default
to make such filings or payments would not result in a Material
Adverse Change. The Company has made appropriate provisions in the
applicable financial statements referred to in Section 1(p) above
in respect of all federal, state, local and foreign income and
franchise taxes for all current or prior periods as to which the
tax liability of the Company or any of its subsidiaries has not
been finally determined.
z) Company Not an Investment
Company . The Company has been advised of the rules and
requirements under the Investment Company Act of 1940, as amended
(the “Investment Company Act”). The Company is not, and
after receipt of payment for the Notes and the application of the
proceeds thereof as contemplated under the caption “Use of
Proceeds” in the Preliminary Prospectus and the Prospectus
will not be, required to register as an “investment
company” within the meaning of the Investment Company
Act.
aa) Insurance . The Company
and its subsidiaries are insured by recognized, financially sound
and reputable institutions with policies in such amounts and with
such deductibles and covering such risks as are generally deemed
adequate and customary for their businesses, including, but not
limited to, policies covering real and personal property owned or
leased by the Company and its subsidiaries against theft, damage,
destruction, acts of vandalism and earthquakes. All policies of
insurance insuring the Company or any of its subsidiaries or their
respective businesses, assets, employees, officers and directors
are in full force and effect; the Company and its subsidiaries are
in compliance with the terms of such policies and instruments in
all material respects; and there are no claims by the Company or
any of its subsidiaries under any such policy or instrument as to
which any insurance company is denying liability or defending under
a reservation of rights clause; and neither the Company nor any
such subsidiary has been refused any insurance coverage sought or
applied for. The Company has no reason to believe that it or any
subsidiary will not be able (i) to renew its existing
insurance
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coverage
as and when such policies expire or (ii) to obtain comparable
coverage from similar institutions as may be necessary or
appropriate to conduct its business as now conducted and at a cost
that would not result in a Material Adverse Change.
bb) No Price Stabilization or
Manipulation . The Company has not taken and will not take,
directly or indirectly, any action designed to or that would
reasonably be expected to cause or result in stabilization or
manipulation of the price of any security of the Company to
facilitate the sale or resale of the Notes.
cc) Related Party Transactions
. There are no business relationships or related-party transactions
involving the Company or any subsidiary or any other person
required to be described in the Preliminary Prospectus or the
Prospectus that have not been described as required.
dd) No Unlawful Contributions or
Other Payments . None of the Company, any of its subsidiaries
or, to the knowledge of the Company, any director, officer, agent,
employee or affiliate of the Company or any of its subsidiaries is
aware of or has taken any action, directly or indirectly, that
would result in a violation by such persons of the Foreign Corrupt
Practices Act of 1977, as amended, and the rules and regulations
thereunder (the “FCPA”), including, without limitation,
making use of the mails or any means or instrumentality of
interstate commerce corruptly in furtherance of an offer, payment,
promise to pay or authorization of the payment of any money, or
other property, gift, promise to give, or authorization of the
giving of anything of value to any “foreign official”
(as such term is defined in the FCPA) or any foreign political
party or official thereof or any candidate for foreign political
office, in contravention of the FCPA, and the Company, its
subsidiaries and, to the knowledge of the Company, its affiliates
have conducted their businesses in compliance with the FCPA and
have instituted and maintain policies and procedures designed to
ensure, and which are reasonably expected to continue to ensure,
continued compliance therewith.
ee) Stock Options . With
respect to the stock options (the “Stock Options”)
granted pursuant to the stock-based compensation plans of the
Company and its subsidiaries (the “Company Stock
Plans”), (i) each Stock Option intended to qualify as an
“incentive stock option” under Section 422 of the
Code so qualifies, (ii) each grant of a Stock Option was duly
authorized no later than the date on which the grant of such Stock
Option was by its terms to be effective (the “Grant
Date”) by all necessary corporate action, including, as
applicable, approval by the board of directors of the Company (or a
duly constituted and authorized committee thereof) and any required
stockholder approval by the necessary number of votes or written
consents, and the award agreement governing such grant (if any) was
duly executed and delivered by each party thereto, (iii) each
such grant was made in accordance with the terms of the Company
Stock Plans, the Exchange Act and all other applicable laws and
regulatory rules or requirements, including the rules of the New
York Stock Exchange and any other exchange on which Company
securities are traded, (iv) the per share exercise price of
each Stock Option was equal to the fair market value of a share of
common stock on the applicable Grant Date and (v) each such
grant was properly accounted for in accordance with generally
accepted accounting principles in the United States in the
financial statements (including the related notes) of the Company
and disclosed in the Company’s filings with the Commission in
accordance with the Exchange Act and all other applicable laws. The
Company has not knowingly granted, and there
10
is no
and has been no policy or practice of the Company of granting,
Stock Options prior to, or otherwise coordinate the grant of Stock
Options with, the release or other public announcement of material
information regarding the Company or its subsidiaries or their
results of operations or prospects.
ff) No Conflict with Money
Laundering Laws . The operations of the Company and its
subsidiaries are and have been conducted at all times in compliance
in all material respects with applicable financial recordkeeping
and reporting requirements of the Currency and Foreign Transactions
Reporting Act of 1970, as amended, the money laundering statutes of
all applicable jurisdictions, the rules and regulations thereunder
and any related or similar rules, regulations or guidelines issued,
administered or enforced by any governmental agency (collectively,
the “Money Laundering Laws”) and no action, suit or
proceeding by or before any court or governmental agency, authority
or body or any arbitrator involving the Company or any of its
subsidiaries with respect to the Money Laundering Laws is pending
or, to the best knowledge of the Company, threatened.
gg) No Conflict with OFAC Laws
. Neither the Company nor any of its subsidiaries nor, to the
knowledge of the Company, any director, officer, agent, employee or
affiliate of the Company or any of its subsidiaries is currently
subject to any U.S. sanctions administered by the Office of Foreign
Assets Control of the U.S. Treasury Department
(“OFAC”); and the Company will not directly or
indirectly use the proceeds of the offering, or lend, contribute or
otherwise make available such proceeds, to any subsidiary, joint
venture partner or other person or entity, for the purpose of
financing the activities of any person currently subject to any
U.S. sanctions administered by OFAC.
hh) Compliance with Environmental
Laws . Except as otherwise disclosed in the Disclosure Package
and the Prospectus, (i) neither the Company nor any of its
subsidiaries is in violation of any federal, state, local or
foreign law, regulation, order, permit or other requirement
relating to pollution or protection of public health, the
environment (including, without limitation, ambient air, surface
water, groundwater, land surface or subsurface strata) or protected
species, including without limitation, laws and regulations
relating to emissions, discharges, releases or threatened releases
of chemicals, pollutants, contaminants, wastes, toxic substances,
hazardous substances, petroleum and petroleum products
(collectively, “Materials of Environmental Concern”),
or otherwise relating to the manufacture, processing, distribution,
use, treatment, storage, disposal, transport or handling of
Materials of Environmental Concern (collectively,
“Environmental Laws”), which violation includes, but is
not limited to, noncompliance with any permits or other
governmental authorizations required for the operation of the
business of the Company or its subsidiaries under applicable
Environmental Laws, or noncompliance with the terms and conditions
thereof, nor has the Company or any of its subsidiaries received
any written communication, whether from a governmental authority,
citizens group, employee or otherwise, that alleges that the
Company or any of its subsidiaries is in violation of any
Environmental Law, except as would not, individually or in the
aggregate, result in Material Adverse Change; (ii) there is no
claim, action or cause of action filed with a court or governmental
authority with respect to which the Company has received written
notice, no investigation by a governmental authority with respect
to which the Company has received written notice, and no written
notice by any person or entity alleging potential liability for
investigatory costs, cleanup costs, governmental response costs,
natural resources damages,
11
property
damages, personal injuries, attorneys’ fees or penalties all
of which arise out of, based on or result from the presence, or
release into the environment, of any Material of Environmental
Concern at any location owned, leased or operated by the Company or
any of its subsidiaries, now or in the past (collectively,
“Environmental Claims”), pending or, to the best of the
Company’s knowledge, threatened against the Company or any of
its subsidiaries or any person or entity whose liability for any
Environmental Claim the Company or any of its subsidiaries has
retained or assumed either contractually or by operation of law,
except as would not, individually or in the aggregate, result in a
Material Adverse Change; (iii) to the best of the
Company’s knowledge, there are no past or present actions,
activities, circumstances, conditions, events or incidents,
including, without limitation, the release, emission, discharge,
presence or disposal of any Material of Environmental Concern, that
reasonably could result in a violation of or liability or
obligation under any Environmental Law, require expenditures to be
incurred pursuant to Environmental Law, or form the basis of a
potential Environmental Claim against the Company or any of its
subsidiaries or against any person or entity whose liability for
any Environmental Claim the Company or any of its subsidiaries has
retained or assumed either contractually or by operation of law,
except as would not, individually or in the aggregate, result in a
Material Adverse Change; and (iv) neither the Company nor any
of its subsidiaries is subject to any pending or to the
Company’s knowledge, threatened proceeding under
Environmental Law to which a governmental authority is a party and
which is reasonably likely to result in monetary sanctions of
$100,000 or more.
ii) Periodic Review of Costs of
Environmental Compliance . In the ordinary course of its
business, the Company conducts a periodic review of the effect of
Environmental Laws on the business, operations and properties of
the Company and its subsidiaries, in the course of which it
identifies and evaluates associated costs and liabilities
(including, without limitation, any capital or operating
expenditures required for clean-up, closure of properties or
compliance with Environmental Laws or any permit, license or
approval, any related constraints on operating activities and any
potential liabilities to third parties). On the basis of such
review and the amount of its established reserves, the Company has
reasonably concluded that such associated costs and liabilities
would not, individually or in the aggregate, result in a Material
Adverse Change.
jj) ERISA Compliance . The
Company and its subsidiaries and any “employee benefit
plan” (as defined in Section 3(3) of the Employee
Retirement Income Security Act of 1974, as amended, and the
regulations and published interpretations thereunder (collectively,
“ERISA”)) established or maintained by the Company, its
subsidiaries or their “ERISA Affiliates” (as defined
below) are in compliance in all material respects with ERISA.
“ERISA Affiliate” means, with respect to the Company or
a subsidiary, any member of any group of organizations described in
Sections 414(b), (c), (m) or (o) of the Internal
Revenue Code of 1986, as amended (the “Internal Revenue
Code”), of which the Company or such subsidiary is a member.
No “reportable event” (as defined under ERISA) has
occurred or is reasonably expected to occur with respect to any
“employee benefit plan” established or maintained by
the Company, its subsidiaries or any of their ERISA Affiliates.
Except for the New Columbia Joist Company Savings Plan, no
“employee benefit plan” established or maintained by
the Company, its subsidiaries or any of their ERISA Affiliates, if
such “employee benefit plan” were terminated, would
have any “amount of unfunded benefit liabilities” (as
defined under ERISA). Neither the Company, its subsidiaries nor any
of their ERISA Affiliates has incurred or
12
reasonably expects to incur any liability under (i) Title IV
of ERISA with respect to termination of, or withdrawal from, any
“employee benefit plan,” (ii) Sections 412,
4971 or 4975 of the Internal Revenue Code, or
(iii) Section 4980B of the Internal Revenue Code with
respect to the excise tax imposed thereunder. Each “employee
benefit plan” established or maintained by the Company, its
subsidiaries or any of their ERISA Affiliates that is intended to
be qualified under Section 401(a) of the Internal Revenue Code has
received a favorable determination letter from the Internal Revenue
Service and nothing has occurred, whether by action or failure to
act, which is reasonably likely to cause disqualification of any
such employee benefit plan under Section 401(a) of the Internal
Revenue Code.
kk) Sarbanes-Oxley Compliance
. There is and has been no failure on the part of the Company and
any of the Company’s directors or officers, in their
capacities as such, to comply with any provision of the
Sarbanes-Oxley Act of 2002 and the rules and regulations
promulgated in connection therewith (the “Sarbanes-Oxley
Act”), including Section 402 related to loans and
Sections 302 and 906 related to certifications.
ll) Company’s Accounting
System . The Company and its subsidiaries maintain effective
internal control over financial reporting, as such term is defined
in Rule 13a-15(f) under the Exchange Act.
mm) Internal Controls and
Procedures . The Company maintains a system of internal
accounting controls sufficient to provide reasonable assurance that
(A) transactions are executed in accordance with
management’s general or specific authorizations;
(B) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally
accepted accounting principles in the United States and to maintain
asset accountability; (C) access to assets is permitted only
in accordance with management’s general or specific
authorization; and (D) the recorded accountability for assets is
compared with the existing assets at reasonable intervals and
appropriate action is taken with respect to any differences.
nn) No Material Weakness in
Internal Controls . Except as disclosed in the Disclosure
Package and the Prospectus or in any document incorporated by
ref
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